Category Archives: Loss Profit Claims

Supreme Court rejects BP appeal of oil spill settlement

Supreme Court rejects BP appeal of oil spill settlement

CBS/AP / December 8 2014, 2:53 PM

NEW ORLEANS – The Supreme Court is leaving in place BP’s multibillion-dollar settlement with lawyers for businesses and residents over the 2010 oil spill in the Gulf of Mexico.

The justices did not comment Monday in rejecting the London-based oil giant’s arguments that lower courts misinterpreted settlement terms and put BP on the hook to pay inflated and bogus claims by businesses.

The court’s decision makes the economic and property damage settlement final, starting a six-month deadline for filing claims, said plaintiffs’ attorney Joe Rice of Mount Pleasant, South Carolina.

BP PLC wanted the court to consider whether people and businesses seeking payments under the settlement included some who haven’t actually suffered any injury related to the spill.

A district court and an appeals court ruled that, under the settlement BP agreed to, businesses do not have to prove they were directly harmed by the spill to collect money – only that they made less money in the three to eight months after the spill than in a comparable pre-spill period.

BP’s Macondo well blew up on April 20, 2010, killing 11 men. An estimated 103 million to 176 million gallons of oil spewed into the Gulf of Mexico before the mile-deep well was capped July 15, 2010. Lawyers for BP and the government agree that 34 million gallons was captured before it could pollute coastal marshes and fishing grounds.

“Today’s ruling is a huge victory for the Gulf, and should finally put to rest BP’s two-year attack on its own settlement,” lead plaintiffs’ attorneys Stephen J. Herman and James P. Roy said in an emailed statement.

The settlement doesn’t have a cap, but BP initially estimated that it would pay roughly $7.8 billion to resolve the claims. The company said it can no longer give a reliable estimate for total cost. The company, which made separate settlements for medical claims and seafood-related business claims, has paid more than $13 billion in claims by individuals, businesses and government entities and another $14 billion-plus on response and cleanup, according to its oil spill website.

BP remains concerned “that the program has made awards to claimants that suffered no injury from the spill – and that the lawyers for these claimants have unjustly profited as a result,” BP spokesman Goeff Morrell said in an emailed statement.

He added, “We will therefore continue to advocate for the investigation of suspicious or implausible claims and to fight fraud where it is uncovered.”

In an interview with “60 Minutes,” Ken Feinberg, the lawyer hired by BP to sort out who was hurt by the spill and who was not, said: One fellow down in Alabama said to me, when I asked him for proof, he said, ‘Mr. Feinberg we do things with a handshake down here.’ I said, ‘That’s fine, but a handshake won’t get you compensation.'”

Feinberg added that it was important to prevent fraud in this case because there will be future catastrophes.

“What happens the next time, in terms of a company’s willingness to do something similar?” Feinberg asked.

BP Senior Vice President Geoff Morell gave “60 Minutes” examples of what they believed where fraudulent claimants: “We’re talking about a wireless phone company store that burned to the ground and shut down before the spill. An RV park owner that was foreclosed upon before the spill. And I love this one. A Pontiac dealer who could no longer sell Pontiacs because GM had discontinued the line before the spill.”

James Roy, one of the victims’ lawyers, told “60 Minutes” he does not feel sorry for the oil giant.

“BP got a good settlement,” Roy said. “And BP was represented by very, very good lawyers who were worthy adversaries who fought tooth and nail for their client. And it was a hard-fought settlement. Their own lawyer said it was a very generous settlement.”

The 5th U.S. Circuit Court of Appeals did get the method for calculating losses changed after BP argued that claims administrator Patrick Juneau wasn’t correctly matching business’s revenues and expenses. The company has been trying to oust Juneau. U.S. District Judge Carl Barbier rejected its claims but BP went to the 5th U.S. Circuit Court of Appeals.

A third-party audit of the settlement program, made public in November, found that it correctly processed 99.5 percent of claims. Chicago-based McGladrey LLP described the program as “well-designed and appropriate.”



Appeals court affirms BP Oil Spill Settlement agreement

Appeals court affirms BP Oil Spill Settlement agreement

On Friday, Jan. 10, a panel of the 5th U.S. Circuit Court of Appeals affirmed federal Judge Carl Barbier’s ruling approving the multi-billion dollar settlement agreement between BP Plc and businesses and individuals financially harmed by the 2010 oil spill in the Gulf of Mexico.

“This ruling is a victory for the people of the Gulf Coast, who may now continue with their efforts to restore their lives and livelihoods following the 2010 BP oil spill,” said Beasley Allen lawyer Rhon Jones, who is serving on the Plaintiffs’ Steering Committee for the ongoing oil spill litigation. “The settlement agreement – which BP itself helped craft and approved – lays out transparent, objective formulas to compensate the victims of the spill. For BP to come behind it at this point, simply because it is costing them more than they expected, is unconscionable. We’re pleased the Court has upheld Judge Barbier’s decision on behalf of the Plaintiffs.”

For the past several months, BP’s lawyers have been attempting to void the agreement, saying its terms had been “misinterpreted,” forcing them to pay “bogus” or inflated claims by businesses. BP has been trying to undo the uncapped settlement agreement since it became apparent that the cost of resolving outstanding claims would exceed its original estimation of $7.8 billion. By October, BP’s estimate for anticipated payments under the uncapped settlement had grown to $9.2 billion, and the company expected the total to go even higher.

BP took the issue to the U.S. 5th District Court of Appeals in November, after Judge Barbier denied the company’s attempts to block payments. In December, two of the judges on the three-judge panel intervened, ordering Judge Barbier to block any and all claims payments to businesses whose “injuries are not traceable to the spill.” The order brought claims payments to a screeching stop.

However, Judge Barbier, who is overseeing oil-spill litigation in New Orleans, rejected BP’s protests that damage claims should not be paid to businesses that can’t prove their losses were directly caused by the 2010 disaster. He said that BP cannot assume a new position on the causation of damages and reverse a settlement agreement that it once deemed “more than fair,” even if abiding by it led to payouts significantly higher than the company’s original projections.

Associated Press
Reuters / The Times-Picayune

BP is actually trying to paint themselves as the real victim of their massive oil spill.

BP underestimated the damage they inflicted on the Gulf, and now they’re trying to backpedal out of the oil spill settlement agreement their own corporate lawyers wrote.

BP is blaming the Judge. BP is blaming the claims administrator. BP is blaming the accountants. BP is blaming the lawyers. Worse, BP is blaming the people and businesses of the Gulf. According to BP, the innocent party is BP itself.

Tell BP to stop the backpedaling and live up to their agreement.


You should check to see if you qualify for BP Oil spill settlement money, it does not cost anything.

Much of the class action lawsuit that spawned the settlement agreement for affected businesses and individuals has not been resolved, but the window for business claims covered by the deal will close in April of next year.

Many businesses not located near the coast have failed to file claims because they assumed they would not qualify, and owners of such businesses should take a closer look at the terms of the settlement. It is recommended to at least do that, It doesn’t cost anything.

The BP Deepwater Horizon spill in April of 2010 dumped 5.9 million barrels of oil into the Gulf, more than 17 times the amount of crude that was spilled by the wreck of the Exxon Valdez tanker in 1989. In the lawsuit for which Juneau is administering claims Alabama, Louisiana, Florida, Texas and Mississippi sued BP and seven other defendants. Strange said it would be a mistake for the state to leave settlement money on the table in light of the severity of the disaster.

The entire coastline of Mississippi was covered in oil,” he said. There was tremendous damage done to the state of Mississippi.

Reuters – BP hit by wave of new spill lawsuits ahead of deadline

(Reuters) – BP Plc (BP.L) has been hit by over 2,200 new lawsuits seeking payback for the 2010 Gulf of Mexico oil spill in the past few weeks as individuals, companies and government bodies rushed to stake their claim before their right to do so expired.

The British oil company, whose deepwater Macondo well ruptured on April 20, 2010, killing 11 men and spilling crude into the sea for weeks, revealed the number of new claims made since March 6 in its first-quarter results on Tuesday.

The United States Oil Pollution Act of 1990, under which most of the new lawsuits were registered, has a three year statute of limitations which could make bringing further legal action difficult after the third anniversary of the disaster.

BP said it would be applying to have the new legal challenges consolidated into a trial that is already under way in New Orleans.

The first phase of the trial of BP and its partners in the well, Transocean (RIG.N) and Halliburton (HAL.N), ended earlier in April, but the judge, Carl Barbier, has yet to rule on the degree of blame that will be apportioned to each party and on the level of negligence that will be applied.

Both decisions could have a big impact on the size of BP’s final liability, already measured in tens of billions of dollars. His ruling, to be made without a jury as is traditional under U.S. maritime law, could come this summer.


BP also revealed that its $20 billion spill fund – some of which is earmarked for compensation claims it has already agreed to pay – has only $1.7 billion still unassigned.

The company is fighting to keep a lid on so-called Business Economic Loss (BEL) claims which are being paid out of the fund at a higher rate and to more businesses than it expected.

In the results statement, it raised its estimate of such compensation payouts it can already quantify to $8.2 billion from $7.7 billion previously.

The estimate has been fluctuating up and down since last year, but BP has continued to stress it does not include any BEL claims that have yet to be made or processed. It has said that should BEL claims balloon beyond what the $20 billion fund can pay, it will have to take new charges against its profits on top of the $42.2 billion overall provision it has already set aside.